08 Feb 2018 | 11.59 am
Strong Q4 Sales Lifts Irish Hotels Market
But 2017 annual sales of €260m well down on 2016's €720m, notes Cushman & Wakefield
08 Feb 2018 | 11.59 am
The Irish hotels market recorded a strong last quarter in 2017, when the value of sales for the three months exceeded the total for the first three quarters put together. Some €172m worth of hotels were sold in the three months to December last.
According to research from Cushman & Wakefield, the turnaround in the final quarter was boosted by three large hotel deals, which brought total hotel investment turnover for 2017 to almost €260m, somewhat short of the 2016 record high of €720m.
However, the figures omit ‘unconventional’ hotel sales, according to the property company, such as the acquisition of the Jurys Inn chain by Swedish hotel group Pandox and Israeli group Fattal Hotels for £800m, as only three of its hotels are located here — with a combined value of €150m.
There were 30 sales in 2017, down on the more than 50 deals annually between 2014 and 2016, a decline explained by the fact that distressed assets sales by banks have largely ended. The most significant sale of the year was that of the 4-star Gibson Hotel (pictured) in Dublin’s North docklands, acquired by German-based investment group, DekaBank, for €87m. This followed Deka’s acquisition last year of the Clayton Hotel on Burlington Road for €182m, the largest hotel deal in 2016.
The share of hotel sales outside the capital grew significantly, from a 26% share in 2016 to 58% in 2017, despite the Gibson Hotel sale. Just five hotels sold in Dublin in the twelve-month period.
New hotels continue to come on stream. The market has seen an uplift of 20.6% in the number of hotel rooms under construction at year end, to over 2,400 rooms in 33 hotels. This is in addition to the 158 rooms, in eight hotels, which completed construction in 2017 in various extensions and redevelopments. There are 13 new hotels currently under construction, of which ten are located in Dublin.
Associate director Isobel Horan said: “The tourism sector in Ireland continues to remain very positive and we are beginning to see the first new tranche of bedrooms being delivered to the Dublin market. These bedrooms are critically important to the city for it to remain competitive as a tourist destination. They will easily be absorbed into the market without any impact on profitability.”